How do you incorporate I bonds into your retirement plans?

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
Post Reply
Topic Author
cresive
Posts: 496
Joined: Sat Nov 26, 2016 12:12 pm
Location: Virginia, USA
Contact:

How do you incorporate I bonds into your retirement plans?

Post by cresive »

I investigated I-bonds a while back, and after running some numbers, I decided they were not a great strategy for me. Originally, I wanted to utilize the I-bonds as a step in my EF strategy—1st tap savings, then tap I-bonds, and ultimately hit my Roth IRA as a reaction to a nuclear life event. Again, as I re-ran the math, they didn’t really work for me. After a year, I stopped investing in them.

However, I would like to revisit the idea of buying I-bonds. I live in a HCOL area with state income taxes. I make enough money to completely max my 401K contributions (both standard plus catch up, so about $25K total for me plus match). After maxing my 401K, paying my mortgage, etc., I don’t have a LOT of extra money, but if I did, would the I-bonds be a good vehicle as an after tax, semi-taxable savings plan? I would use them as a long-term investment but would like to be able to access the money if needed.

My question is how do others successfully incorporate I-bonds into their investment/retirement plans? Am I missing a big aspect that I could incorporate into my strategy? Are I-bonds only a good option AFTER you have maxed all your other vehicles? And mostly, what are the best options to incorporate I-bonds into your savings plans?

Thanks,
Ben


PS. I fear this may have been covered, but I don’t know how to search previous threads. If this has been covered extensively, in addition to adding the post, can you tell me how to search for them?
Jack FFR1846
Posts: 14247
Joined: Tue Dec 31, 2013 7:05 am
Location: 26 miles, 385 yards west of Copley Square

Re: How do you incorporate I bonds into your retirement plans?

Post by Jack FFR1846 »

Why did they "not work for you"?

I only have only paper bonds and have $5k coming from this year's refund to add to the others. Paper easily is converted to immediately available funds at my credit union. I've taken a stack of $50k worth in one shot and it was simple and the time it took me to sign each one was the majority of the time to cash. The funds were available before I left.

There's no state tax, ever. Of course, federal tax is deferred until you cash the bonds. After a year, you can cash them. I've been buying for over 2 decades and took advantage of those times when I could buy $30k per person using a credit card for no fee and could cash them in 6 months. When my fed return bonds come, I'll have $381k worth.

I consider the bonds to be both emergency fund and part of my bond allocation.
Bogle: Smart Beta is stupid
SciurusVulgaris
Posts: 87
Joined: Sat Sep 26, 2015 7:48 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by SciurusVulgaris »

This could differ depending on your personal needs for your portfolio. In my DIY IPS, I rely on I Bonds as a third tier of my emergency fund, with a Roth IRA (from your example) as the fourth tier. They do double duty as a tax-deferred inflation protected bond fund.

Since you're over 50 and haven't accumulated much in I Bonds, have a max of $15,000/year, and probably a realistic amount that's much less, I Bonds may not move the needle much for anything other than a more tax efficient part of an emergency fund.

I'll be curious to see what others say.

Have you seen these pages in the wiki?
https://www.bogleheads.org/wiki/I_savin ... _portfolio
https://www.bogleheads.org/wiki/Tax-eff ... _placement
dcabler
Posts: 2103
Joined: Wed Feb 19, 2014 11:30 am

Re: How do you incorporate I bonds into your retirement plans?

Post by dcabler »

So many ways to use these things, but for me, I use Ibonds, along with TIPs to form something of a COLA'd bond ladder that I will tap into when I turn 70. I consider it a supplement that, when combined with our SS will just about cover all essential spending for about 15 years. Rest of portfolio is for the extras in life and to fund pre-age-70 retirement. I have the ladder set up to last about 15 years, after which I'll consider a SPIA if it makes sense.

I've otherwise filled up all of my tax advantaged space for now, so having taxes on Ibonds deferred is nice, too.

Cheers.
User avatar
Svensk Anga
Posts: 968
Joined: Sun Dec 23, 2012 5:16 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by Svensk Anga »

I built a CD and TIPS ladder to cover routine expenses from early retirement to age 70 and maximum SS. I added I bonds to handle non-routine/lumpy expenses like car or AC replacement and big insurance deductibles. They work well for the non-routine since you can redeem them at any time after a year (though better after five) with minimal hassle and no brokerage spread or commission.
deikel
Posts: 1265
Joined: Sat Jan 25, 2014 7:13 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by deikel »

I don't see their purpose

Its nothing you could not do with savings accounts, CDs, MM fund or bond funds - so why bother ?
Everything you read in this post is my personal opinion. If you disagree with this disclaimer, please un-read the text immediately and destroy any copy or remembrance of it.
SuzBanyan
Posts: 882
Joined: Thu Jun 02, 2016 11:20 am

Re: How do you incorporate I bonds into your retirement plans?

Post by SuzBanyan »

We are using them to supplement income from early 60’s semi-retirement to age 70 SS. We buy $40k per year with me, my husband our revocable trust and an irrevocable trust each buying $10k. Now have 5 years in place from purchases beginning 2016 and can cash out as needed with no penalty beginning next year.
SciurusVulgaris
Posts: 87
Joined: Sat Sep 26, 2015 7:48 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by SciurusVulgaris »

deikel wrote: Fri Mar 27, 2020 1:15 pm I don't see their purpose

Its nothing you could not do with savings accounts, CDs, MM fund or bond funds - so why bother ?
An I Bond's return is adjusted for inflation and are a deflation hedge. They can be tax deferred, are state tax exempt, and they can be used for education (with exceptions).

Savings accounts, CDs, and MM funds are assets that at best keep pace with inflation, although are also a deflation hedge. Unless they're kept in retirement accounts, they are all have a tax drag. Unless you're a very low tax bracket, this is a difference to consider.
User avatar
simplesimon
Posts: 4096
Joined: Mon Feb 25, 2008 8:53 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by simplesimon »

deikel wrote: Fri Mar 27, 2020 1:15 pm I don't see their purpose

Its nothing you could not do with savings accounts, CDs, MM fund or bond funds - so why bother ?
These typically will not protect you from unexpected inflation.
deikel
Posts: 1265
Joined: Sat Jan 25, 2014 7:13 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by deikel »

simplesimon wrote: Fri Mar 27, 2020 2:01 pm
deikel wrote: Fri Mar 27, 2020 1:15 pm I don't see their purpose

Its nothing you could not do with savings accounts, CDs, MM fund or bond funds - so why bother ?
These typically will not protect you from unexpected inflation.
What about inflation is unexpected ? Its an after the fact value of loss in purchasing power from month to month. All of the above will rise with inflation (not necessarily in lock step of course), but market pressure will push rates on them up with Inflation.
Everything you read in this post is my personal opinion. If you disagree with this disclaimer, please un-read the text immediately and destroy any copy or remembrance of it.
User avatar
simplesimon
Posts: 4096
Joined: Mon Feb 25, 2008 8:53 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by simplesimon »

deikel wrote: Fri Mar 27, 2020 2:10 pm
simplesimon wrote: Fri Mar 27, 2020 2:01 pm
deikel wrote: Fri Mar 27, 2020 1:15 pm I don't see their purpose

Its nothing you could not do with savings accounts, CDs, MM fund or bond funds - so why bother ?
These typically will not protect you from unexpected inflation.
What about inflation is unexpected ? Its an after the fact value of loss in purchasing power from month to month. All of the above will rise with inflation (not necessarily in lock step of course), but market pressure will push rates on them up with Inflation.
1) You can't guarantee that
2) CD's and Bonds will get crushed.
User avatar
Clever_Username
Posts: 1859
Joined: Sun Jul 15, 2012 12:24 am
Location: Southern California

Re: How do you incorporate I bonds into your retirement plans?

Post by Clever_Username »

I have a portion of my asset allocation for conservative assets, a category that includes Series I Bonds. I have bought them in full since 2014 and I count them towards that portion.

How I'll use them? They're a tier in my emergency plan and, if they last until the 30 year mark, I'll cash them in. I don't have any particular other plans for them, but I don't need to either.
"What was true then is true now. Have a plan. Stick to it." -- XXXX, _Layer Cake_ | | I survived my first downturn and all I got was this signature line.
alluringreality
Posts: 494
Joined: Tue Nov 12, 2019 10:59 am

Re: How do you incorporate I bonds into your retirement plans?

Post by alluringreality »

deikel wrote: Fri Mar 27, 2020 1:15 pmI don't see their purpose
I tend to group I bonds with other low-risk investments like high yield savings, money market funds, and short-term bonds or CDs. I bonds may perform slightly differently than the other options, and I bonds might also offer some advantages like no state tax and federal tax deferral. For example in 2019 the Fed lowered rates, which caused high yield savings rates to decrease, but holders of I bonds instead had their rate increase in November due to higher inflation. Basically if there's a chance that inflation and the I bond fixed rate might exceed short-term rates, then I bonds might be worth considering over similar options. One downside of I bonds is paying federal tax on any increase in value, so someone in a high tax bracket or primarily concerned with protecting their money against high inflation might prefer TIPS in a Roth.
deikel wrote: Fri Mar 27, 2020 2:10 pm What about inflation is unexpected ?
I think of unexpected inflation as being inflation that ends up above the breakeven rate, as discussed here.
https://seekingalpha.com/article/408658 ... -inflation
Targets: 15% I Bonds, 15% EE Bonds, 45% US Stock (Mid & Small Tilt), 25% Ex-US Stock (Small Tilt)
User avatar
Phineas J. Whoopee
Posts: 9675
Joined: Sun Dec 18, 2011 6:18 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by Phineas J. Whoopee »

deikel wrote: Fri Mar 27, 2020 2:10 pm
simplesimon wrote: Fri Mar 27, 2020 2:01 pm
deikel wrote: Fri Mar 27, 2020 1:15 pm I don't see their purpose

Its nothing you could not do with savings accounts, CDs, MM fund or bond funds - so why bother ?
These typically will not protect you from unexpected inflation.
What about inflation is unexpected ? Its an after the fact value of loss in purchasing power from month to month. All of the above will rise with inflation (not necessarily in lock step of course), but market pressure will push rates on them up with Inflation.
We can expect inflation to compound over time, of course. What can be unexpected is its rate, higher or lower.

Nominal Treasuries include a market expectation of how much inflation will be. One measure, not the only, is break-even inflation, at which nominal and inflation-protected Treasuries will have the same nominal yield. There are other measures. I like to use break-even because, even though we know it is an estimate, at least it's objectively calculable.

There's an important difference, deikel I'm sure you know it but I always write with lurkers in mind, between nominal yields and real yields. The former are calculated simply based on the present dollar-value of the bonds. The latter take inflation into account. Of course we won't know how much will be realized until after the fact.

We know TIPS, subject to their real yields which sometimes are negative, and Series I Savings Bonds will keep up with the Consumer Price Index, CPI-U in particular. We don't know whether nominal Treasuries will. That's among the risks one takes using fixed income.

PJW
smectym
Posts: 1189
Joined: Thu May 26, 2011 5:07 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by smectym »

cresive wrote: Fri Mar 27, 2020 8:42 am I investigated I-bonds a while back, and after running some numbers, I decided they were not a great strategy for me. Originally, I wanted to utilize the I-bonds as a step in my EF strategy—1st tap savings, then tap I-bonds, and ultimately hit my Roth IRA as a reaction to a nuclear life event. Again, as I re-ran the math, they didn’t really work for me. After a year, I stopped investing in them.

However, I would like to revisit the idea of buying I-bonds. I live in a HCOL area with state income taxes. I make enough money to completely max my 401K contributions (both standard plus catch up, so about $25K total for me plus match). After maxing my 401K, paying my mortgage, etc., I don’t have a LOT of extra money, but if I did, would the I-bonds be a good vehicle as an after tax, semi-taxable savings plan? I would use them as a long-term investment but would like to be able to access the money if needed.

My question is how do others successfully incorporate I-bonds into their investment/retirement plans? Am I missing a big aspect that I could incorporate into my strategy? Are I-bonds only a good option AFTER you have maxed all your other vehicles? And mostly, what are the best options to incorporate I-bonds into your savings plans?

Thanks,
Ben


PS. I fear this may have been covered, but I don’t know how to search previous threads. If this has been covered extensively, in addition to adding the post, can you tell me how to search for them?
We have a ton of them, admittedly, most purchased when there were higher fixed rates than available today, but they’ve been a solid anchor for our retirement portfolio. If there is a resurgence of inflation *as measured by official CPI*, you’ll see the value of these quickly enough, with or without a favorable fixed rate
Day9
Posts: 1000
Joined: Mon Jun 11, 2012 6:22 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by Day9 »

I have $20k of the 0.5% real yielding I Bonds and I am happy I have them. I treat them as part of my bond allocation. I have a bond barbell and include I Bonds in the short end of the barbell, and long term treasury bonds in the long end of the barbell.
I'm just a fan of the person I got my user name from
Topic Author
cresive
Posts: 496
Joined: Sat Nov 26, 2016 12:12 pm
Location: Virginia, USA
Contact:

Re: How do you incorporate I bonds into your retirement plans?

Post by cresive »

SciurusVulgaris wrote: Fri Mar 27, 2020 9:30 am This could differ depending on your personal needs for your portfolio. In my DIY IPS, I rely on I Bonds as a third tier of my emergency fund, with a Roth IRA (from your example) as the fourth tier. They do double duty as a tax-deferred inflation protected bond fund.

This is exactly how I was planning to use them. However, the vesting time (I didn't mind the 1 year moratorium, but the 5 year fully vesting seemed to be a big issue if I wanted to use the bonds as a part of my EF.

Since you're over 50 and haven't accumulated much in I Bonds, have a max of $15,000/year, and probably a realistic amount that's much less, I Bonds may not move the needle much for anything other than a more tax efficient part of an emergency fund.

I think that was part of my thinking as well. Thanks for the feed back, you seem to hit the same points I was dealing with.

I'll be curious to see what others say.

Have you seen these pages in the wiki?
https://www.bogleheads.org/wiki/I_savin ... _portfolio
https://www.bogleheads.org/wiki/Tax-eff ... _placement
Last edited by cresive on Sat Mar 28, 2020 8:27 pm, edited 1 time in total.
Topic Author
cresive
Posts: 496
Joined: Sat Nov 26, 2016 12:12 pm
Location: Virginia, USA
Contact:

Re: How do you incorporate I bonds into your retirement plans?

Post by cresive »

SuzBanyan wrote: Fri Mar 27, 2020 1:20 pm We are using them to supplement income from early 60’s semi-retirement to age 70 SS. We buy $40k per year with me, my husband our revocable trust and an irrevocable trust each buying $10k. Now have 5 years in place from purchases beginning 2016 and can cash out as needed with no penalty beginning next year.
How do you double dip with the revocable trust? Isn't the limit per SS number?
Topic Author
cresive
Posts: 496
Joined: Sat Nov 26, 2016 12:12 pm
Location: Virginia, USA
Contact:

Re: How do you incorporate I bonds into your retirement plans?

Post by cresive »

alluringreality wrote: Fri Mar 27, 2020 3:20 pm
deikel wrote: Fri Mar 27, 2020 1:15 pmI don't see their purpose
I tend to group I bonds with other low-risk investments like high yield savings, money market funds, and short-term bonds or CDs. I bonds may perform slightly differently than the other options, and I bonds might also offer some advantages like no state tax and federal tax deferral. For example in 2019 the Fed lowered rates, which caused high yield savings rates to decrease, but holders of I bonds instead had their rate increase in November due to higher inflation. Basically if there's a chance that inflation and the I bond fixed rate might exceed short-term rates, then I bonds might be worth considering over similar options. One downside of I bonds is paying federal tax on any increase in value, so someone in a high tax bracket or primarily concerned with protecting their money against high inflation might prefer TIPS in a Roth.

This is an interesting concept I hadn't thought of--lower correlation between your "lower-risk" investments. I will have to contemplate this idea.

Thanks
User avatar
Noobvestor
Posts: 5921
Joined: Mon Aug 23, 2010 1:09 am

Re: How do you incorporate I bonds into your retirement plans?

Post by Noobvestor »

They're part bond, part emergency fund, all with an amazing amount of flexibility - cash them in anywhere between 1 and 30 years! I may hold onto mine indefinitely, or may cash them in during low/no-income (low-tax) years in early retirement, or sooner if something way better comes along. To me, that flexibility is probably their greatest appeal, aside from the obvious (real) capital preservation promise they offer.

For portfolio purposes, I see them as short-duration, ultra-safe, inflation-protected bonds. My IPS calls for a mix of real and nominal bonds all toward the safe end of the spectrum averaging out to an intermediate duration, so I Bonds are one of multiple holdings on that front. Why short duration? Well, it's subjective, but like short-duration TIPS funds or cash they're relatively liquid and aren't sensitive to NAV volatility.
"In the absence of clarity, diversification is the only logical strategy" -= Larry Swedroe
Topic Author
cresive
Posts: 496
Joined: Sat Nov 26, 2016 12:12 pm
Location: Virginia, USA
Contact:

Re: How do you incorporate I bonds into your retirement plans?

Post by cresive »

How does income from I-bond Interest affect IRMAA calculations? I see the benefit from no state taxes, unless I move to TX or FL, etc., Do I bonds help with medicare premiums at all?
JBTX
Posts: 8911
Joined: Wed Jul 26, 2017 12:46 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by JBTX »

I'm going to guess that ibonds affect Medicare if/when they are cashed out and interest becomes taxable.

I've used ibonds as a combination of 2nd tier emergency/liquidity fund and part of bond allocation. Perhaps have about 9 months expenses worth in total. Last 2 years traded out some 0% fixed returns for 0.5% return ones and obviously had to pay tax on interest expense. I'll probably go ahead and buy $20k more currently at 0.2% before May deadline.

When interest rates were trending up a year or more ago I was a little less enthusiastic about them. But now with real rates of traditional bonds and tips mostly in negative territory they are starting to look good again. With all the trillions of liquidity being injected into the economy I'm starting to think some inflation protection is prudent.
Niccolo
Posts: 1
Joined: Sat Mar 28, 2020 11:09 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by Niccolo »

I use a modified "Swensen 6" approach. He recommends 15% of your portfolio in US-treasure inflation-protected bonds. I allocate 7%. I like I-bonds better than TIPS because of the tax consequences. Because of the $10k/year buying limits, I also have a small amount of a gold ETF I purchased to "fill in" to 7% (my view on gold being that it's not a great inflation hedge in the short-term, being too uncorrelated with inflation, but it's a good one over multiple decades). I don't think inflation is at all likely anytime soon, but it's one of the scariest long-term threats to a retirement portfolio. So it's nice to have some protection.
smectym
Posts: 1189
Joined: Thu May 26, 2011 5:07 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by smectym »

JBTX wrote: Sat Mar 28, 2020 9:02 pm I'm going to guess that ibonds affect Medicare if/when they are cashed out and interest becomes taxable.

I've used ibonds as a combination of 2nd tier emergency/liquidity fund and part of bond allocation. Perhaps have about 9 months expenses worth in total. Last 2 years traded out some 0% fixed returns for 0.5% return ones and obviously had to pay tax on interest expense. I'll probably go ahead and buy $20k more currently at 0.2% before May deadline.

When interest rates were trending up a year or more ago I was a little less enthusiastic about them. But now with real rates of traditional bonds and tips mostly in negative territory they are starting to look good again. With all the trillions of liquidity being injected into the economy I'm starting to think some inflation protection is prudent.
JBTX, we have issues with the Medicare break points, but that’s because work income has bled into our supposed “retirement” years. If you’re really retired, and drawing just SS and IRA withdrawals, you probably have a decent amount of flexibility to stay under the income break point that would trigger higher Medicare payments, even if you’re cashing in some I bonds. Of course we’re not at the 30-year point yet on any of those I bonds, so we still have discretion whether to cash them or not
JBTX
Posts: 8911
Joined: Wed Jul 26, 2017 12:46 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by JBTX »

smectym wrote: Sun Mar 29, 2020 12:18 am
JBTX wrote: Sat Mar 28, 2020 9:02 pm I'm going to guess that ibonds affect Medicare if/when they are cashed out and interest becomes taxable.

I've used ibonds as a combination of 2nd tier emergency/liquidity fund and part of bond allocation. Perhaps have about 9 months expenses worth in total. Last 2 years traded out some 0% fixed returns for 0.5% return ones and obviously had to pay tax on interest expense. I'll probably go ahead and buy $20k more currently at 0.2% before May deadline.

When interest rates were trending up a year or more ago I was a little less enthusiastic about them. But now with real rates of traditional bonds and tips mostly in negative territory they are starting to look good again. With all the trillions of liquidity being injected into the economy I'm starting to think some inflation protection is prudent.
JBTX, we have issues with the Medicare break points, but that’s because work income has bled into our supposed “retirement” years. If you’re really retired, and drawing just SS and IRA withdrawals, you probably have a decent amount of flexibility to stay under the income break point that would trigger higher Medicare payments, even if you’re cashing in some I bonds. Of course we’re not at the 30-year point yet on any of those I bonds, so we still have discretion whether to cash them or not
That makes sense. I was only responding to the question OP posed on it, but yes unless you have other income or really large rmds it shouldn't be an issue.

Not really on topic, but I suspect your situation is not uncommon. I see a lot of threads on optimizing plans based on early retirement and taxes and essentially zero assumed additional income in retirement, but often it doesnt play out that way.
Topic Author
cresive
Posts: 496
Joined: Sat Nov 26, 2016 12:12 pm
Location: Virginia, USA
Contact:

Re: How do you incorporate I bonds into your retirement plans?

Post by cresive »

JBTX wrote: Sun Mar 29, 2020 12:29 am
smectym wrote: Sun Mar 29, 2020 12:18 am
JBTX wrote: Sat Mar 28, 2020 9:02 pm I'm going to guess that ibonds affect Medicare if/when they are cashed out and interest becomes taxable.

I've used ibonds as a combination of 2nd tier emergency/liquidity fund and part of bond allocation. Perhaps have about 9 months expenses worth in total. Last 2 years traded out some 0% fixed returns for 0.5% return ones and obviously had to pay tax on interest expense. I'll probably go ahead and buy $20k more currently at 0.2% before May deadline.

When interest rates were trending up a year or more ago I was a little less enthusiastic about them. But now with real rates of traditional bonds and tips mostly in negative territory they are starting to look good again. With all the trillions of liquidity being injected into the economy I'm starting to think some inflation protection is prudent.
JBTX, we have issues with the Medicare break points, but that’s because work income has bled into our supposed “retirement” years. If you’re really retired, and drawing just SS and IRA withdrawals, you probably have a decent amount of flexibility to stay under the income break point that would trigger higher Medicare payments, even if you’re cashing in some I bonds. Of course we’re not at the 30-year point yet on any of those I bonds, so we still have discretion whether to cash them or not
That makes sense. I was only responding to the question OP posed on it, but yes unless you have other income or really large rmds it shouldn't be an issue.

Not really on topic, but I suspect your situation is not uncommon. I see a lot of threads on optimizing plans based on early retirement and taxes and essentially zero assumed additional income in retirement, but often it doesnt play out that way.
Thanks to both of you. Great feedback and information.

Ben
AlwaysLearningMore
Posts: 375
Joined: Sun Jul 26, 2020 2:29 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by AlwaysLearningMore »

deikel wrote: Fri Mar 27, 2020 2:10 pm
simplesimon wrote: Fri Mar 27, 2020 2:01 pm
deikel wrote: Fri Mar 27, 2020 1:15 pm I don't see their purpose

Its nothing you could not do with savings accounts, CDs, MM fund or bond funds - so why bother ?
These typically will not protect you from unexpected inflation.
What about inflation is unexpected ? Its an after the fact value of loss in purchasing power from month to month. All of the above will rise with inflation (not necessarily in lock step of course), but market pressure will push rates on them up with Inflation.
This didn't age particularly well.

Image
Retirement is best when you have a lot to live on, and a lot to live for.
User avatar
BrandonBogle
Posts: 4245
Joined: Mon Jan 28, 2013 11:19 pm

Re: How do you incorporate I bonds into your retirement plans?

Post by BrandonBogle »

Indeed AlwaysLearningMore!

I hold I-Bonds and consider them part of my Financial Instrument holdings, which are predominantly bond funds. I don't really think of them explicitly for an emergency fund, but I consider my portfolio available for nuclear emergencies. I just buy my $10k-$15k annually and include it in my allocation when rebalancing.

Overall, I think of them as another way to expand my tax-advantaged/deferred holdings. Between traditional 401k, Roth IRA, HSA, I-Bonds, and a taxable account, I have plenty of flexibility in managing my income and taxes when retirement comes along.
Post Reply